HF 4049

as introduced - 85th Legislature (2007 - 2008) Posted on 12/15/2009 12:00am

A bill for an act
relating to health; guaranteeing that all necessary health care is available and
affordable for every Minnesotan; establishing the Minnesota Health Plan,
Minnesota Health Board, Minnesota Health Fund, Office of Health Quality
and Planning, ombudsman for patient advocacy, and inspector general for the
Minnesota Health Plan; appropriating money; amending Minnesota Statutes
2006, sections 14.03, subdivision 2; 15A.0815, subdivision 2; proposing coding
for new law as Minnesota Statutes, chapter 62U.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

GENERAL PROVISIONS

Section 1.

[62U.01] HEALTH PLAN REQUIREMENTS.

In order to keep Minnesotans healthy and provide the best quality of health care,
the Minnesota Health Plan must:

(1) ensure all Minnesotans receive high quality health care, regardless of their
income;

(2) not restrict, delay, or deny care or reduce the quality of care to hold down costs,
but instead reduce costs through prevention, efficiency, and reduction of bureaucracy;

(3) cover all necessary care, including all coverage currently required by law,
complete mental health services, chemical dependency treatment, prescription drugs,
medical equipment and supplies, dental care, long-term care, and home care services;

(4) allow patients to choose their own providers;

(5) be funded through premiums based on ability to pay and other revenue sources;

(6) focus on preventive care and early intervention to improve the health of all
Minnesota residents and reduce costs from untreated illnesses and diseases;

(7) ensure an adequate number of qualified health care professionals and facilities to
guarantee availability of, and timely access to quality care throughout the state;

(8) continue Minnesota's leadership in medical education, training, research, and
technology; and

(9) provide adequate and timely payments to providers.

Sec. 2.

[62U.02] MINNESOTA HEALTH PLAN GENERAL PROVISIONS.

Subdivision 1.

Short title.

This chapter may be cited as the "Minnesota Health Act."

Subd. 2.

Purpose.

The Minnesota Health Plan shall provide all medically necessary
health care services for all Minnesota residents in a manner that meets the requirements
in section 62U.01.

Subd. 3.

Definitions.

As used in this chapter, the following terms have the meanings
provided:

(a) "Board" means the Minnesota Health Board.

(b) "Plan" means the Minnesota Health Plan.

(c) "Fund" means the Minnesota Health Fund.

(d) "Medically necessary" means a health service that is consistent with the
recipient's diagnosis or condition, is recognized as the prevailing standard or current
practice by the provider's peer group, and is rendered to:

(1) treat an injury, illness, infection, or pain;

(2) treat a condition that could result in physical or mental disability;

(3) care for a mother and child through a maternity period;

(4) achieve a level of physical or mental function consistent with prevailing
community standards for the diagnosis or condition; or

(5) provide a preventive health service.

(e) "Institutional provider" means an inpatient hospital, nursing facility, rehabilitation
facility, and other health care facilities that provide overnight care.

(f) "Noninstitutional provider" means group practices, clinics, outpatient surgical
centers, imaging centers, other health facilities that do not provide overnight care, and
individual providers.

Subd. 4.

Ethics and conflict of interest.

(a) All provisions of section 43A.38 apply
to employees and the executive officer of the Minnesota Health Plan, the members and
directors of the Minnesota Health Board, the regional health boards, the director of the
Office of Health Quality and Planning, the director of the Minnesota Health Fund, and
the ombudsman. Failure to comply with section 43A.38 shall be grounds for disciplinary
action including termination of employment or removal from the board.

(b) In order to avoid the appearance of political bias or impropriety, the Minnesota
Health Plan executive officer shall not:

(1) engage in leadership of, or employment by, a political party or a political
organization;

(2) publicly endorse a political candidate;

(3) contribute to any political candidates or political parties and political
organizations; or

(4) attempt to avoid compliance with this subdivision by making contributions
through a spouse or other family member.

(c) In order to avoid a conflict of interest, individuals specified in paragraph (a) shall
not be currently employed by a medical provider or a pharmaceutical, medical insurance,
or medical supply company. This paragraph does not apply to the five provider members
of the board.

Subd. 5.

Data practice.

Notwithstanding chapter 13, other state agencies shall
cooperate with data sharing and provide all requested information to the board or board
designee, the Ombudsman for Patient Advocacy, the director of the Office of Health
Quality and Planning, and the Inspector General.

ARTICLE 2

ELIGIBILITY

Section 1.

[62U.03] ELIGIBILITY.

Subdivision 1.

Residency.

All Minnesota residents are eligible for the Minnesota
Health Plan.

Subd. 2.

Enrollment; identification.

The Minnesota Health Board shall establish
a procedure to enroll residents and provide each with identification that may be used by
health care providers to confirm eligibility for services. The application for enrollment
shall be no more than two pages.

Subd. 3.

Residents temporarily out of state.

(a) The Minnesota Health Plan shall
provide health care coverage to Minnesota residents who are temporarily out of the state
who intend to return and reside in Minnesota.

(b) Coverage for emergency care obtained out of state shall be at prevailing local
rates. Coverage for nonemergency care obtained out of state shall be according to rates
and conditions established by the board. The board may require that a resident be
transported back to Minnesota when prolonged treatment of an emergency condition is
necessary and when that transport will not adversely affect a patient's care or condition.

Subd. 4.

Visitors.

Nonresidents visiting Minnesota shall be billed for all services
received under the Minnesota Health Plan. The board may enter into intergovernmental
arrangements or contracts with other states and countries to provide reciprocal coverage
for temporary visitors.

Subd. 5.

Nonresident employed in Minnesota.

The board may extend eligibility to
nonresidents employed in Minnesota using a sliding premium scale.

Subd. 6.

Retiree benefits.

(a) All persons who are eligible for retiree medical
benefits under an employer-employee contract, including retirees who elect to reside
outside of Minnesota, shall remain eligible for those benefits provided the contractually
mandated payments for those benefits are made to the Minnesota Health Fund, which shall
assume financial responsibility for care provided under the terms of the contract.

(b) The board may establish financial arrangements with states and foreign countries
in order to facilitate meeting the terms of the contracts described in paragraph (a).
Payments for care provided by non-Minnesota providers to Minnesota retirees shall be
reimbursed at rates established by the Minnesota Health Board.

Subd. 7.

Presumptive eligibility.

(a) An individual is presumed eligible for
coverage under the Minnesota Health Plan if the individual arrives at a health facility
unconscious, comatose, or otherwise unable, because of the individual's physical or
mental condition, to document eligibility or to act on the individual's own behalf. If the
patient is a minor, the patient is presumed eligible, and the health facility shall provide
care as if the patient were eligible.

(b) Any individual is presumed eligible when brought to a health facility according
to any provision of section 253B.05.

(c) Any individual involuntarily committed to an acute psychiatric facility or to a
hospital with psychiatric beds according to any provision of section 253B.05, providing
for involuntary commitment, is presumed eligible.

(d) All health facilities subject to state and federal provisions governing emergency
medical treatment must comply with those provisions.

ARTICLE 3

BENEFITS

Section 1.

[62U.04] BENEFITS.

Subdivision 1.

General provisions.

Any eligible individual may choose to receive
services under the Minnesota Health Plan from any licensed participating provider. A
provider may not refuse to care for a patient on the basis that is specified in the definition
of unfair employment practice in section 363A.08.

Subd. 2.

Covered benefits.

Covered benefits in this chapter include all medically
necessary care subject to the limitations specified in subdivision 4. Covered benefits
include:

(1) inpatient and outpatient health facility services;

(2) inpatient and outpatient professional health care provider services by licensed
health care professionals;

(3) diagnostic imaging, laboratory services, and other diagnostic and evaluative
services;

(4) medical equipment, appliances, and assistive technology, including prosthetics,
eyeglasses, and hearing aids and their repair;

(5) inpatient and outpatient rehabilitative care;

(6) emergency transportation;

(7) necessary transportation for health care services for disabled and indigent
persons;

(8) language interpretation and translation for health care services, including sign
language and Braille or other services needed for individuals with communication
disabilities;

(9) child and adult immunizations and preventive care;

(10) health education;

(11) hospice care;

(12) home health care;

(13) all prescription drugs on the Minnesota Health Plan formulary and additional
drugs as specified by the board;

(14) all prescription drugs as determined by the board if the Minnesota Health Plan
does not have a prescription drug formulary;

(15) mental health services;

(16) dental care;

(17) podiatric care;

(18) chiropractic care;

(19) acupuncture;

(20) blood and blood products;

(21) emergency care services;

(22) vision care;

(23) adult day care;

(24) case management and coordination to ensure services necessary to enable a
person to remain safely in the least restrictive setting;

(25) substance abuse treatment;

(26) care in a skilled nursing facility; and

(27) dialysis.

Subd. 3.

Benefit expansion.

The Minnesota Health Board may expand benefits
beyond the minimum benefits described in this section when expansion meets the intent of
this chapter and when there are sufficient funds to cover the expansion.

Subd. 4.

Exclusions.

The following health care services shall be excluded from
coverage by the Minnesota Health Plan:

(1) health care services determined to have no medical benefit by the board;

(2) surgery, dermatology, orthodontia, prescription drugs, and other procedures
primarily for cosmetic purposes, unless required to correct a congenital defect, restore or
correct a part of the body that has been altered as a result of injury, disease, or surgery, or
determined to be medically necessary by a qualified, licensed health care provider in the
Minnesota Health Plan;

(3) private rooms in inpatient health facilities where appropriate nonprivate rooms
are available, unless determined to be medically necessary by a qualified, licensed
provider in the Minnesota Health Plan; and

(4) services of a health care provider or facility that is not licensed or accredited
by the state, except for approved services provided to a Minnesota resident who is
temporarily out of the state.

Subd. 4a.

Prohibition.

The Minnesota Health Plan shall not pay for prescription
drugs from pharmaceutical companies that directly market the drugs to consumers.

Subd. 5.

No-cost sharing.

No deductible, co-payment, co-insurance, or other
cost-sharing shall be imposed with respect to covered benefits.

Sec. 2.

[62U.041] CARE COORDINATION.

(a) All patients shall have a primary care provider or other provider who shall
coordinate the care a patient receives. A specialist may serve as the care coordinator
if the patient and the specialist agree to this arrangement, and if the specialist agrees
to coordinate the patient's care.

(b) Referrals are not required for a patient to see a health care specialist. If a patient
sees a specialist and does not have a care coordinator, the patient must choose a care
coordinator. The Minnesota Health Plan may assist with choosing a primary care provider
to coordinate care.

(c) The board may establish or ensure the establishment of a computerized referral
registry to facilitate referrals.

ARTICLE 4

FUNDING

Section 1.

[62U.19] MINNESOTA HEALTH FUND.

Subdivision 1.

General provisions.

(a) The board shall establish a Minnesota
Health Fund to implement the Minnesota Health Plan and to receive premiums and
other sources of revenue. The fund shall be administered by a director appointed by the
Minnesota Health Board.

(b) All money collected, received, and transferred according to this chapter shall
be deposited in the Minnesota Health Fund for the purpose of financing the Minnesota
Health Plan.

(c) Money deposited in the Minnesota Health Fund shall be used exclusively to
implement the purpose of this chapter.

(d) All claims for health care services rendered shall be made to the Minnesota
Health Fund.

(e) All payments made for health care services shall be disbursed from the Minnesota
Health Fund.

(f) Premiums and other revenues collected each year must be sufficient to cover
that year's projected costs.

Subd. 2.

Accounts.

The Minnesota Health Fund shall have operating, capital, and
reserve accounts to provide for all state expenditures for health care.

Subd. 3.

Budgets within the operating account.

The operating account in
the Minnesota Health Fund shall be comprised of the accounts and budgets specified
in paragraphs (a) to (e).

(a) Medical services budget and account. The medical services budget and
account must be used to provide for all medical services and benefits covered under the
Minnesota Health Plan.

(b) Prevention budget and account. The prevention budget and account must be
used solely to establish and maintain primary community prevention programs, including
preventive screening tests.

(c) Program administration, evaluation, planning, and assessment budget and
account. The program administration, evaluation, planning, and assessment budget and
account must be used to monitor and improve the plan's effectiveness and operations. The
board may establish grant programs including demonstration projects for this purpose.

(d) Training, development, and continuing education budget and account. The
training, development, and continuing education budget and account must be used to
support the training, development, and continuing education of health care providers and
the health care workforce needed to meet the health care needs of the population.

(e) Medical research budget and account. The medical research budget and
account must be used to support research and innovation as determined by the Minnesota
Health Board, and recommended by the Office of Health Quality and Planning and the
Ombudsman for Patient Advocacy.

Subd. 4.

Capital account.

The capital account must be used solely to pay for capital
expenditures for institutional providers and all capital expenditures requiring approval
from the Minnesota Health Board as specified in section 62U.05, subdivision 4.

Subd. 5.

Reserve account.

(a) The Minnesota Health Plan must at all times hold in
reserve an amount estimated in the aggregate to provide for the payment of all losses and
claims for which the Minnesota Health Plan may be liable and to provide for the expense
of adjustment or settlement of losses and claims.

(b) Money currently held in reserve by state, city, and county health programs must
be transferred to the Minnesota Health Fund when the Minnesota Health Plan replaces
those programs.

(c) The board shall have provisions in place to insure the Minnesota Health Plan
against unforeseen expenditures or revenue shortfalls not covered by the reserve account
and the board may borrow money to cover temporary shortfalls.

Sec. 2.

[62U.20] REVENUE SOURCES.

Subdivision 1.

Minnesota Health Plan premium.

(a) The Minnesota Health Board
shall:

(1) determine the aggregate costs of providing health care according to this chapter;

(2) develop an equitable and affordable premium structure, including unearned
income as part of the premium determination for Minnesota residents, that is progressive
and based on the ability to pay and an employer health premium for businesses that
together will generate adequate revenue for the Minnesota Health Fund;

(3) in consultation with the Department of Revenue, develop an efficient means of
collecting premiums and employer health premiums; and

(4) coordinate with existing, ongoing funding sources from federal and state
programs.

(b) On or before January 15, 2010, the board shall submit to the governor and the
legislature a report on the premium and employer health premium structure established to
finance the Minnesota Health Plan.

Subd. 2.

Funds from outside sources.

Institutional providers operating under
Minnesota Health Plan operating budgets may raise and expend funds from sources other
than the Minnesota Health Plan including private or foundation donors. Contributions to
providers in excess of $500,000 must be reported to the board.

Subd. 3.

Governmental payments.

The executive officer and, if required under
federal law, the commissioners of health and human services shall seek all necessary
waivers, exemptions, agreements, or legislation so that all current federal payments to the
state for health care are paid directly to the Minnesota Health Plan, which shall then assume
responsibility for all benefits and services previously paid for by the federal government
with those funds. In obtaining the waivers, exemptions, agreements, or legislation, the
executive officer and, if required, commissioners shall seek from the federal government a
contribution for health care services in Minnesota that reflects: medical inflation, the state
gross domestic product, the size and age of the population, the number of residents living
below the poverty level, and the number of Medicare and VA eligible individuals, and does
not decrease in relation to the federal contribution to other states as a result of the waivers,
exemptions, agreements, or savings from implementation of the Minnesota Health Plan.

Subd. 4.

Federal preemption.

(a) The board shall pursue all reasonable means to
secure a repeal or a waiver of any provision of federal law that preempts any provision of
this chapter. The commissioners of health and human services shall provide all necessary
assistance.

(b) In the event that a repeal or a waiver of law or regulations cannot be secured,
the board shall adopt rules, or seek conforming state legislation, consistent with federal
law, in an effort to best fulfill the purposes of this chapter.

(c) The Minnesota Health Plan's responsibility for providing care shall be secondary
to existing federal government programs for health care services to the extent that funding
for these programs is not transferred to the Minnesota Health Fund or that the transfer
is delayed beyond the date on which initial benefits are provided under the Minnesota
Health Plan.

Sec. 3.

[62U.21] SUBROGATION.

Subdivision 1.

Collateral source.

(a) When other payers for health care have been
terminated, health care costs shall be collected from collateral sources whenever medical
services provided to an individual are, or may be, covered services under a policy of
insurance, or other collateral source available to that individual, or when the individual
has a right of action for compensation permitted under law.

(b) As used in this section, collateral source includes:

(1) health insurance policies and the medical components of automobile,
homeowners, and other forms of insurance;

(2) medical components of worker's compensation;

(3) pension plans;

(4) employer plans;

(5) employee benefit contracts;

(6) government benefit programs;

(7) a judgment for damages for personal injury; and

(8) any third party who is or may be liable to an individual for health care services
or costs.

(c) Collateral source does not include:

(1) a contract or plan that is subject to federal preemption; or

(2) any governmental unit, agency, or service, to the extent that subrogation
is prohibited by law. An entity described in paragraph (b) is not excluded from the
obligations imposed by this section by virtue of a contract or relationship with a
government unit, agency, or service.

(d) The board shall negotiate waivers, seek federal legislation, or make other
arrangements to incorporate collateral sources into the Minnesota Health Plan.

Subd. 2.

Collateral source; negotiation.

When an individual who receives health
care services under the Minnesota Health Plan is entitled to coverage, reimbursement,
indemnity, or other compensation from a collateral source, the individual shall notify the
health care provider and provide information identifying the collateral source, the nature
and extent of coverage or entitlement, and other relevant information. The health care
provider shall forward this information to the board. The individual entitled to coverage,
reimbursement, indemnity, or other compensation from a collateral source shall provide
additional information as requested by the board.

Subd. 3.

Reimbursement.

(a) The Minnesota Health Plan shall seek reimbursement
from the collateral source for services provided to the individual and may institute
appropriate action, including legal proceedings, to recover the reimbursement. Upon
demand, the collateral source shall pay to the Minnesota Health Fund the sums it would
have paid or expended on behalf of the individual for the health care services provided by
the Minnesota Health Plan.

(b) In addition to any other right to recovery provided in this section, the board shall
have the same right to recover the reasonable value of benefits from a collateral source as
provided to the commissioner of human services under section 256B.37.

(c) If a collateral source is exempt from subrogation or the obligation to reimburse
the Minnesota Health Plan, the board may require that an individual who is entitled to
medical services from the source first seek those services from that source before seeking
those services from the Minnesota Health Plan.

(d) To the extent permitted by federal law, the board shall have the same right of
subrogation over contractual retiree health benefits provided by employers as other
contracts, allowing the Minnesota Health Plan to recover the cost of services provided to
individuals covered by the retiree benefits, unless arrangements are made to transfer the
revenues of the benefits directly to the Minnesota Health Plan.

Subd. 4.

Defaults, underpayments, and late payments.

(a) Default, underpayment,
or late payment of any tax or other obligation imposed by this chapter shall result in the
remedies and penalties provided by law, except as provided in this section.

(b) Eligibility for benefits under section 62U.04 shall not be impaired by any
default, underpayment, or late payment of any premium or other obligation imposed
by this chapter.

ARTICLE 5

PAYMENTS

Section 1.

[62U.05] PROVIDER PAYMENTS.

Subdivision 1.

General provisions.

(a) All health care providers licensed to practice
in Minnesota may participate in the Minnesota health plan.

(b) A participating health care provider shall comply with all federal laws and
regulations governing referral fees and fee splitting including, but not limited to, United
States Code, title 42, sections 1320a-7b and 1395nn, whether reimbursed by federal funds
or not.

(c) A fee schedule or financial incentive may not adversely affect the care a patient
receives or the care a health provider recommends.

Subd. 2.

Payments to noninstitutional providers.

(a) The Minnesota Health Board
shall establish and oversee a uniform fee schedule for noninstitutional providers.

(b) The board shall pay noninstitutional providers based on rates negotiated with
providers. Rates may factor in geographic differences to address provider shortages.

(c) The board shall examine the need for and methods of paying providers for care
coordination for all patients especially those with chronic illness and complex medical
needs.

(d) Providers may request reimbursement of ancillary health care or social services
that were previously funded by money now received and disbursed by the Minnesota
health fund.

(e) Providers who accept any payment from the Minnesota health plan for a covered
service shall not bill the patient for the covered service.

(f) Providers shall be paid within 30 business days for claims filed following
procedures established by the board.

Subd. 3.

Payments to institutional providers.

(a) The board shall establish annual
budgets for institutional providers. These budgets shall consist of an operating and a
capital budget. An institution's annual budget shall be negotiated to cover its anticipated
services for the next year based on past performance and projected changes in prices
and service levels.

(b) Providers who accept any payment from the Minnesota Health Plan for a covered
service shall not bill the patient for the covered service.

Subd. 4.

Capital management plan.

(a) The board shall periodically develop a
capital investment plan that will serve as a guide in determining the annual budgets of
institutional providers and in deciding whether to approve applications for approval of
capital expenditures by noninstitutional providers.

(b) Providers who propose to make capital purchases in excess of $500,000 must
obtain board approval. The board may alter the threshold expenditure level that triggers
the requirement to submit information on capital expenditures. Institutional providers
shall propose these expenditures and submit the required information as part of the annual
budget they submit to the board. Noninstitutional providers shall submit applications for
approval of these expenditures to the board.

ARTICLE 6

GOVERNANCE

Section 1.

Minnesota Statutes 2006, section 14.03, subdivision 2, is amended to read:

Subd. 2.

Contested case procedures.

The contested case procedures of the
Administrative Procedure Act provided in sections 14.57 to 14.69 do not apply to (a)
proceedings under chapter 414, except as specified in that chapter, (b) the commissioner of
corrections, (c) the unemployment insurance program and the Social Security disability
determination program in the Department of Employment and Economic Development,
(d) the commissioner of mediation services, (e) the Workers' Compensation Division in
the Department of Labor and Industry, (f) the Workers' Compensation Court of Appeals,
or (g) the Board of Pardons, or (h) the Minnesota Health Plan.

Sec. 2.

Minnesota Statutes 2006, section 15A.0815, subdivision 2, is amended to read:

Subd. 2.

Group I salary limits.

The salaries for positions in this subdivision may
not exceed 95 percent of the salary of the governor:

Commissioner of administration;

Commissioner of agriculture;

Commissioner of education;

Commissioner of commerce;

Commissioner of corrections;

Commissioner of employee relations;

Commissioner of finance;

Commissioner of health;

Executive officer of the Minnesota Health Plan;

Executive director, Minnesota Office of Higher Education;

Commissioner, Housing Finance Agency;

Commissioner of human rights;

Commissioner of human services;

Commissioner of labor and industry;

Commissioner of natural resources;

Director of Office of Strategic and Long-Range Planning;

Commissioner, Pollution Control Agency;

Commissioner of public safety;

Commissioner of revenue;

Commissioner of employment and economic development;

Commissioner of transportation; and

Commissioner of veterans affairs.

Sec. 3.

[62U.06] MINNESOTA HEALTH BOARD.

Subdivision 1.

Establishment.

The Minnesota Health Board is established to
promote the delivery of high quality, coordinated health care services that enhance health;
prevent illness, disease, and disability; slow the progression of chronic diseases; and
improve personal health management. The board shall administer the Minnesota Health
Plan. The board shall oversee:

(1) the Office of Health Quality and Planning under section 62U.09; and

(2) the Minnesota Health Fund under section 62U.19.

Subd. 2.

Board composition.

The board shall consist of 15 members, including
a representative selected by each of the five rural regional health planning boards under
section 62U.08 and three representatives selected by the metropolitan regional health
planning board under section 62U.08. These members shall select the following:

(1) one consumer member and one employer member appointed by the board
members; and

(2) five providers appointed by the board members that include one primary care
physician, one registered nurse, one mental health provider, one dentist, and one facility
director.

The board shall select the chair from its membership.

Subd. 3.

Term and compensation.

Board members shall serve four years. Board
members shall set the board's compensation not to exceed the compensation of Public
Utilities Commission members.

Subd. 4.

General duties.

The board shall:

(1) ensure that all of the requirements of section 62U.01 are met;

(2) hire an executive officer for the Minnesota Health Plan to administer all aspects
of the plan as directed by the board;

(3) hire a director for the Office of Health Quality and Planning;

(4) hire a director of the Minnesota Health Fund;

(5) provide technical assistance to the regional boards established under section
62U.08;

(6) conduct necessary investigations and inquiries and require the submission of
information, documents, and records the board considers necessary to carry out the
purposes of this chapter;

(7) establish a process for the board to receive the concerns, opinions, ideas, and
recommendations of the public regarding all aspects of the Minnesota Health Plan and
the means of addressing those concerns;

(8) conduct other activities the board considers necessary to carry out the purposes
of this chapter;

(9) collaborate with the agencies that license health facilities to ensure that facility
performance is monitored and that deficient practices are recognized and corrected in a
timely manner;

(10) adopt rules as necessary to carry out the duties assigned under this chapter;

(11) establish conflict of interest standards prohibiting providers from any financial
benefit from their medical decisions outside of board reimbursement; and

(12) establish conflict of interest standards related to pharmaceutical marketing to
providers.

Subd. 5.

Financial duties.

The board shall:

(1) establish and collect premiums and employer health premiums according to
section 62U.20, subdivision 1;

(2) approve statewide and regional budgets that include budgets for the accounts
in section 62U.19;

(3) establish payment rates for providers which may reflect regional differences to
address provider shortages;

(4) monitor compliance with all budgets and payment rates and take action to
achieve compliance to the extent authorized by law;

(5) pay claims for medical products or services as negotiated, and may issue requests
for proposals for a contract to process claims submitted by individual nonprofit providers;

(6) negotiate fees, prices, and budgets;

(7) administer the Minnesota Health Fund created under section 62U.19;

(8) annually determine the appropriate level for the Minnesota Health Plan reserve
account and implement policies needed to establish the appropriate reserve;

(9) implement fraud prevention measures necessary to protect the operation of
the Minnesota Health Plan; and

(10) work to ensure appropriate cost control by:

(i) instituting aggressive public health measures, early intervention and preventive
care, and promotion of personal health improvement;

(ii) making changes in the delivery of health care services and administration that
improve efficiency and care quality;

(iii) minimizing administrative costs;

(iv) ensuring that the delivery system does not contain excess capacity; and

(v) negotiating the lowest possible prices for prescription drugs, medical equipment,
and medical services.

If the board determines that there will be a revenue shortfall despite the cost control
measures mentioned in clause (10), the board shall implement measures to correct the
shortfall, including an increase in premiums. The board shall report to the legislature on
the causes of the shortfall, reasons for the failure of cost controls, and measures taken to
correct the shortfall.

Subd. 6.

Minnesota Health Board management duties.

The board shall:

(1) develop and implement enrollment procedures for providers and persons eligible
for the program and disseminate, to providers of services and to the public, information
concerning the program and the persons eligible to receive benefits under the program;

(2) implement eligibility standards for the Minnesota Health Plan, including
standards to prevent an influx of persons to the state for the purpose of obtaining medical
care;

(3) make recommendations, when needed, to the legislature about changes in the
geographic boundaries of the health planning regions;

(4) establish an electronic claims and payments system for the Minnesota Health
Plan;

(5) monitor the operation of the Minnesota Health Plan through consumer surveys
and regular data collection and evaluation activities, including evaluations of the adequacy
and quality of services furnished under the program, the need for changes in the benefit
package, the cost of each type of service, and the effectiveness of cost control measures
under the program;

(6) establish a health care Web site that provides information to the public about the
Minnesota Health Plan including access information on providers and facilities, and that
informs the public about state and regional health planning board meetings and activities;

(7) collaborate with public health agencies, schools, and community clinics;

(8) ensure that Minnesota Health Plan policies and providers, including public
health providers, support all Minnesota residents in achieving and maintaining maximum
physical and mental health functionality; and

(9) annually report to the legislature on the performance of the Minnesota Health
Plan, fiscal condition and need for payment adjustments, any needed changes in
geographic boundaries of the health planning regions, recommendations for statutory
changes, receipt of revenue from all sources, whether current year goals and priorities are
met, future goals and priorities, major new technology or prescription drugs, and other
circumstances that may affect the cost of health care.

Subd. 7.

Policy duties.

The board shall:

(1) develop and implement cost control and quality assurance procedures, including
a professional peer review system;

(2) ensure strong public health services including education and community
prevention and clinical services;

(3) ensure a continuum of coordinated high-quality primary to tertiary care to all
Minnesota residents; and

(4) implement policies to ensure that all Minnesotans receive culturally and
linguistically competent care.

Sec. 4.

[62U.07] HEALTH PLANNING REGIONS.

A metropolitan health planning region consisting of the seven-county metropolitan
area is established as well as five rural health planning regions from the greater Minnesota
area composed of geographically contiguous counties grouped on the basis of the
following considerations:

(1) patterns of utilization of health care services;

(2) health care resources, including workforce resources;

(3) health needs of the population, including public health needs;

(4) geography;

(5) population and demographic characteristics; and

(6) other considerations as appropriate.

The commissioner of health shall designate the health planning regions.

Sec. 5.

[62U.08] REGIONAL HEALTH PLANNING BOARD.

Subdivision 1.

Regional planning board composition.

(a) Initially, each regional
board shall consist of one county commissioner per county and two county commissioners
per county in the seven-county metropolitan area. A county commissioner may designate
a representative to act as a member of the board in the member's absence. Each board
shall select the chair from among its membership.

(b) Board members shall serve for four-year terms and may receive per diems for
meetings at the rate specified in section 15.059, subdivision 3.

Subd. 2.

Regional health board duties.

Regional health planning boards shall:

(1) recommend health standards, goals, priorities, and guidelines for the region;

(2) prepare an operating and capital budget for the region to recommend to the
Minnesota Health Board;

(3) collaborate with local public health care agencies to educate consumers and
providers on public health programs, goals, and the means of reaching those goals;

(4) hire a regional health planning director;

(5) collaborate with public health care agencies to implement public health and
wellness initiatives; and

(6) ensure that all parts of the region have access to a 24-hour nurse hotline and
24-hour urgent care clinics.

Sec. 6.

[62U.09] OFFICE OF HEALTH QUALITY AND PLANNING.

Subdivision 1.

Establishment.

The Minnesota Health Board shall establish an
Office of Health Quality and Planning to assess the quality, access, and funding adequacy
of the Minnesota Health Plan.

Subd. 2.

General duties.

(a) The Office of Health Quality and Planning shall make
annual recommendations to the board on the overall direction on subjects including:

(1) the overall effectiveness of the Minnesota Health Plan in addressing public
health and wellness;

(2) access to care;

(3) quality improvement;

(4) efficiency of administration;

(5) adequacy of budget and funding;

(6) appropriateness of payments for providers;

(7) capital expenditure needs;

(8) long-term care;

(9) mental health and substance abuse services;

(10) staffing levels and working conditions in health care facilities;

(11) identification of number and mix of health care facilities and providers required
to best meet the needs of the Minnesota Health Plan;

(12) care for chronically ill patients;

(13) research needs; and

(14) integration of disease management programs into care delivery.

(b) Analyze shortages in health care workforce required to meet the needs of the
population and develop plans to meet those needs in collaboration with regional planners
and educational institutions.

(c) Assist in coordination of the Minnesota Health Plan and public health programs.

Subd. 3.

Assessment and evaluation of benefits.

The Office of Health Quality
and Planning shall:

(1) consider benefit additions to the Minnesota Health Plan and evaluate them based
on evidence of clinical efficacy;

(2) establish a process and criteria by which providers may request authorization
to provide services and treatments that are not included in the Minnesota Health Plan
benefit set, including experimental treatments;

(3) evaluate proposals to increase the efficiency and effectiveness of the health care
delivery system, and make recommendations to the board based on the cost-effectiveness
of the proposals; and

(4) identify complementary and alternative modalities that have been shown to be
safe and effective.

Sec. 7.

[62U.10] OMBUDSMAN OFFICE FOR PATIENT ADVOCACY.

Subdivision 1.

Creation of office; generally.

(a) The Ombudsman Office for
Patient Advocacy is created to represent the interests of the consumers of health care.
The ombudsman shall help residents of the state secure the health care services and
benefits they are entitled to under the laws administered by the Minnesota Health Board
and advocate on behalf of and represent the interests of enrollees in entities created by
this chapter and in other forums.

(b) The ombudsman shall be a patient advocate appointed by the governor, who
serves in the unclassified service and may be removed only for just cause. The ombudsman
must be selected without regard to political affiliation and must be knowledgable about
and have experience in health care services and administration.

(c) The ombudsman may gather information about decisions, acts, and other matters
of the Minnesota Health Board, health care organization, or a health care program. A
person may not serve as ombudsman while holding another public office.

(d) The budget for the ombudsman's office shall be determined by the legislature and
is independent from the Minnesota Health Board which has no oversight or authority over
the ombudsman for patient advocacy. The ombudsman shall establish offices to provide
convenient access to residents.

Subd. 2.

Ombudsman's duties.

(a) The ombudsman for patient advocacy shall:

(1) ensure that patient advocacy services are available to all Minnesota residents;

(2) establish and maintain the grievance process according to section 62U.11;

(3) receive, evaluate, and respond to consumer complaints about the Minnesota
Health Plan;

(4) establish a process to receive recommendations from the public about ways to
improve the Minnesota Health Plan;

(5) develop educational and informational guides according to communication
services under section 15.441, describing consumer rights and responsibilities;

(6) ensure the guides in clause (5) are widely available to consumers and specifically
available in provider offices and health care facilities; and

(7) report annually to the public, the board, and the legislature about the consumer
perspective on the performance of the Minnesota Health Plan, including recommendations
for needed improvements.

(b) The patient advocate, in carrying out assigned duties, shall have unlimited access
to all nonconfidential and all nonprivileged documents in the custody and control of the
Minnesota Health Board.

Sec. 8.

[62U.11] GRIEVANCE SYSTEM.

Subdivision 1.

Grievance system established.

The ombudsman for patient
advocacy shall establish a grievance system for all complaints. The system shall provide
reasonable procedures that shall ensure adequate consideration of Minnesota Health Plan
enrollee grievances and appropriate remedies.

Subd. 2.

Referral of grievances.

The ombudsman for patient advocacy may
refer any grievance that does not pertain to compliance with this chapter to the federal
Center for Medicaid or any other appropriate local, state, and federal government entity
for investigation and resolution.

Subd. 3.

Submittal by designated agents and providers.

A provider may join
with, or otherwise assist, a complainant to submit the grievance to the ombudsman
without fear of retribution.

Subd. 4.

Review of documents.

The ombudsman may require additional
information from health care providers or the board.

Subd. 5.

Written notice of disposition.

The ombudsman shall send a written
notice of the final disposition of the grievance, and the reasons for the decision, to the
complainant, to any provider who is assisting the complainant, and to the board, within 30
calendar days of receipt of the request for review unless the ombudsman determines that
additional time is reasonably necessary to fully and fairly evaluate the relevant grievance.
The ombudsman's order of corrective action shall be binding on the Minnesota Health
Plan. Decisions of the ombudsman may be appealed in district court.

Sec. 9.

[62U.12] INSPECTOR GENERAL FOR THE MINNESOTA HEALTH
PLAN.

Subdivision 1.

Establishment.

There is within the Office of the Attorney General an
inspector general for the Minnesota Health Plan who is appointed by the attorney general.

Subd. 2.

Duties.

The inspector general shall:

(1) investigate, audit, and review the financial and business records of individuals,
public and private agencies and institutions, and private corporations that provide services
or products to the Minnesota Health Plan, the costs of which are reimbursed by the
Minnesota Health Plan;

(2) investigate allegations of misconduct on the part of an employee or appointee
of the Minnesota Health Board and on the part of any provider of health care services
that is reimbursed by the Minnesota Health Plan, and report any findings of misconduct
to the attorney general;

(3) investigate patterns of medical practice that may indicate fraud and abuse
related to over or under utilization or other inappropriate utilization of medical products
and services;

(4) arrange for the collection and analysis of data needed to investigate the
inappropriate utilization of these products and services; and

(5) annually report recommendations for improvements to the Minnesota Health
Plan to the board.

Sec. 10.

[62U.13] EXAMINATION BY LEGISLATIVE AUDITOR.

The books and all operating policies and procedures of the Minnesota Health Board
shall be subject to examination by the legislative auditor.

ARTICLE 7

IMPLEMENTATION

Section 1. APPROPRIATION.

$....... is appropriated in fiscal year 2009 from the general fund to the Minnesota
Health Fund under the Minnesota Health Plan to implement the provisions of this act.

Sec. 2. REPEALER.

Provider tax .......

MNCARE .......

Parts of Medical Assistance .......

General Assistance medical care .......

Sec. 3. EFFECTIVE DATE AND TRANSITION.

Subdivision 1.

Notice and effective date.

This act is effective the day following
final enactment. The commissioner of finance shall notify the chairs of the house of
representatives and senate committees with jurisdiction over health care when the
Minnesota Health Fund has sufficient revenues to fund the costs of implementing this act.

Subd. 2.

Timing to implement.

The Minnesota Health Plan must be operational
within two years from the date of final enactment of this act.

Subd. 3.

Prohibition.

On and after the day the Minnesota Health Plan becomes
operational, a health plan, as defined in Minnesota Statutes, section 62Q.01, subdivision 3,
may not be sold in Minnesota for services provided by the Minnesota Health Plan.

Subd. 4.

Transition.

(a) The commissioners of health and human services shall
prepare an analysis of the state's capital expenditure needs for the purpose of assisting
the board in adopting the statewide capital budget for the year following implementation.
The commissioners shall submit this analysis to the board.

(b) The following timelines shall be implemented:

(1) the commissioner of health shall designate the health planning regions utilizing
the criteria specified in Minnesota Statutes, section 62U.07, three months after the date
of enactment of this act;

(2) the regional boards shall be established six months after the date of enactment
of this act; and

(3) the Minnesota Health Board shall be established nine months after the date
of enactment of this act.